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Why Rent-to-Own?
1. Ownership of your home!
2. No massive up-front down payment! $500 + Rent moves you in!
3. No option fees! 100% of all deposits credited to your down payment!
4. Rents & sales prices based on current market rents and sales, not projected values!
5. $100 monthly credits, just for paying your rent on time and handling minor maintenance!
6. We'll reimburse you for 3 months of legal credit repair!
7. Seller assistance at closing if needed!
How Does Rent-to-Own Work?
1. You apply to our rent-to-own program.
2. You rent the house.
3. We help you repair your credit.
4. Your security deposits and other credits build into a sizable down payment.
5. Your on-time rental payment history of one year or more makes you look good to lenders.
6. We help you get a mortgage on the house.
7. You cease to be a renter, and instead become a home owner!
Do I Need Good Credit?
No!
We do not care about your credit scores, your youthful credit blunders
from years ago that still haunt you, or even a recent foreclosure or
eviction caused by a layoff, a medical issue you were underinsured for,
or some other unforseen catastrophy. We will run your credit, verify your employment, check
your rental history, and check your criminal history. However, all we
are looking to do is to verify that you are reasonably likely
to be willing and able to pay the rent and deposits, and that you are a
person who would not cause problems in the community.
How Much is the Deposit?
Your initial deposit is only $500!
This will take the property off the market for 2 weeks, while we check
your credit report, verify your employment, and check your rental
history. Once we have accepted your application, it's just a matter of
paying your first month's rent to move in.
$50 of the deposit is a non-refundable application fee. If your
application is rejected, or you choose not to rent the property after
your application has been processed, $450 will be refunded to you at
the address listed on your application.
When Do I Start Owning the House?
Your initial deposit is the first step towards owning the house!
In addition to your initial deposit, while you are renting the house,
you will make monthly deposits, which will be classified a 'security
deposit' on the house, and which will be refunded to you if you choose
not to buy, but otherwise maintain your rental agreement. However, when
you officially buy the house, all of these deposits will be credited to
you as a 'down payment' on the house!
We collect $250, seperate from your monthly rent, on the 15th of each month,
to coincide with most people's bi-weekly pay periods.
This money is kept in a seperate account, which is a dedicated to
holding these deposits, until they are refunded to you at move-out, or
transfered to the appropriate account when you buy the house.
This way you are guaranteed to make monthly progress towards your goal
of home ownership, without the need for the self-discipline of
'piggy-banks' that can easily be caniballized to buy a new TV, a new
car, or other impulse item, before you amass enough for a down payment
on a home of your own.
You'll have $3,500 set aside by the end of year one, $6,500 by the end of year two, and so on, until you are ready to buy.
Is There Any Way to Get Cheaper Rent?
Actually,
the rents we advertise are already discounted! Our advertised rents
assume that you will pay your rent on time, and take care of minor
maintenance around the house, and include a $100 a month rent credit
already! Obviously, we'll take care of major repairs, like a broken A/C
or hot water heater. However, we'll gladly credit you $100 a
month to take care of changing your A/C filters, changing smoke
detector batteries, and other preventative maintenance, if it will keep
us from getting called at 3am because of some minor, preventable issue
like a clogged A/C filter preventing the A/C from cooling!
I Heard That Lease-Options are Illegal in Texas, Isn't Rent-To-Own the Same Thing?
Lease-options are not illegal, and it is not the same thing as rent-to-own.
This misconception comes from the fact Texas laws restrict
lease-options to six months and impose extreme fines on the seller for
failure to transfer title to buyer in that time. While this was done to
'protect' buyers from unscrupulous sellers, it effectively outlawed one
of the few home-buying tools available to people who lack the down payment and/or credit to buy now, but who anticipate being able to within the next few years.
A lease-option is a
single contract explicitly conbining the lease (rental) agreement and
the purchase agreement, wherein the renter/buyer pays rent plus an
additional fee, called option consideration, which grants the
renter/buyer the option to buy the house at a pre-determined price for
a certain period of time. In exchange for the additional fee, the
seller is obligated to sell the property for that predetermined price
at any point during that period, regardless of any changes in the
market, etc. The seller gets extra money each month, while the buyer
gets to lock-in a purchase price on the house for a few years.
Rent-to-Own is nothing
more than
renting a house then buying it later, with the rental security
deposit credited toward the purchase
as a down-payment. There is no explicit linking of the lease/rental
agreement and the purchase agreement, only the implicit agreement that
the renter intends to buy the property at a later date, for a
predetermined amount, and that the seller intends to sell it to them
for that amount. The seller typically gets a larger than average
security deposit and tenants who will take better care of the property
than regular renters, while the buyer gets to rent the house until they
are ready to buy it, without losing any money as an option fee.
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Encompass
Strategies LLC is a real estate investment company.
©
2008
Encompass Strategies LLC. All Rights Reserved.
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